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A sharper edge for steel’s market development sword

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To be competitive in today's global marketplace, the steel industry must have a clear understanding of current market trends and a vision for those issues that will define future market demand.

To take advantage of opportunities in an increasingly competitive global marketplace, the American Iron and Steel Institute (AISI) has established the Steel Market Development Institute (SMDI), a business unit of AISI. Building on the success of AISI's market development programs, the SMDI's mission is "to advance the competitive use of steel through a market-driven strategy that promotes cost-effective steel-based solutions." In other words, the SMDI is now the AISI's leading organization for actively engaging customers, designers, developers and other interest groups in meeting market demand with innovative steel solutions.

The essential purpose behind the SMDI's strategic business model resides in three areas the need to sustain long-term market demand consistent with the industry's investment in capital; a critical strategy to address competing material challenges to market share; and the engagement of customers in both defining and investing in new technologies.

Through a comprehensive, five-year business plan, the SMDI has defined a strategic "road map" for where to apply the industry's annual investment in order to ensure long-term steel demand.

Customer partnerships and collaboration with the design community are essential to achieving the long-term goals of the SMDI mission. As a primary material industry, steel is 100 percent dependent on the downstream manufacturing sector—our customers—to convert steel into consumable products such as automobiles, buildings, bridges and containers. Today, there are more than 265 organizations, ranging from large original equipment manufacturers (OEMs) to small fabricators, partnering in the SMDI programs. These partnerships are essential to our advancements in the market and in helping customers remain competitive.

Designers, engineers and specifiers are also actively involved in helping to define the criteria that guide the selection and use of today's advanced steel products. The SMDI programs also work closely with government, code development and environmental groups to address mutual steel solutions.

North American steel producers have collectively invested more than $60 billion in new technologies since 1990, resulting in the ability to provide high-strength, state-of-the-art and safety-oriented steel solutions in the marketplace. These solutions range from fuel-efficient auto designs to energy-saving home construction to tamper-resistant food cans. With the launch of the SMDI, the industry will have more autonomy to grow steel demand in the automotive, construction and container markets, continuing to deliver advanced steel solutions and technology transfer to the marketplace to meet the needs of our customers and consumers.

In automotive

Today, advanced high-strength steels are revolutionizing the automotive market, thanks in part to the efforts of AISI's automotive market program. Just a decade ago, many of today's automotive steels didn't exist, and automotive experts thought steel was the material of the past. Now, advanced steel products that AISI's market development group members have brought to the marketplace are helping to redefine the next generation of vehicles.

This year, the AISI began work with the International Iron and Steel Institute on the Future Steel Vehicle project, which will develop steel auto body concepts that address alternative powertrains, such as advanced hybrid, electric and fuel cell systems. The goal of this research is to demonstrate safe, structurally efficient steel bodies for future vehicles to reduce greenhouse gas emissions over the entire life of the vehicle.

In addition, recognizing the steel industry's commitment to reducing greenhouse gas emissions, joint funding has been authorized by the U.S. Energy Department and the National Science Foundation to join with the Auto/Steel Partnership to fund research for developing the next generation of advanced high-strength steels. This research will explore even greater reductions in mass and energy consumption for future vehicles.

In construction

AISI's construction market group has initiated programs that target steel demand in traditional building and infrastructure markets while developing new growth opportunities in the residential sector. These programs range from basic design research and building code development to new design and fabrication technologies.

Working closely with key customer groups, the AISI established a construction market sustainability program to address competing material challenges driven by the climate change debate.

Growing interest in sustainable buildings is helping to push steel framing into the spotlight. With a minimum of 25-percent recycled content, cold-formed steel meets the tests for an environmentally responsible material and can be an important addition to any project where sustainable construction and design is a critical requirement. It is important to note that steel framing contributes to efforts in any building project to earn credits or points for most recognized green-building rating programs and other government incentives.

In containers

The container market programs are specifically targeting consumer demand for affordable, nutritious foods. Through the Canned Food Alliance, a partnership of steel producers, can manufacturers and food processors, this program has commissioned research that shows canned food is comparable with, or in some cases more nutritious than, fresh and frozen foods.

The nutritional value of canned food was successfully recognized this year in new federal legislation. The result is that canned food is now being included, along with fresh and frozen fruits and vegetables, in government-sponsored nutrition assistance programs.

In addition, federal provisions in the new Women, Infants and Children (WIC) Rule specify canned fruits, vegetables, beans, seafood and juice as permitted in WIC Food Packages. The new fruit and vegetable cash-value voucher program funding of $934 million over five years is projected to result in an additional $40 million in annual canned food sales from the WIC program.

Out in front

Industries that thrive consistently stay ahead of their competitors by providing solutions that meet their future customers' needs, and the SMDI will be doing just that. We will take a long-term, strategic look at what is needed to keep the North American steel industry competitive.

Our aggressive approach to pre-competitive collaboration between steel producers and customers provides value to our members in the form of successful steel solutions in the marketplace. Examples of successful steel company partnerships with customers include the Auto/Steel Partnership and the Steel Framing Alliance. We also will work closely with the Steel Recycling Institute to promote sustainable steel solutions.

As SMDI's chairman, J. James Kutka Jr., U.S. Steel's senior vice president, strategic planning and business development, said at its launch "The creation of the SMDI signals a new level of commitment by these steel producers to advance leading-edge technologies and steel's focus on future market opportunities."

With the launch of the SMDI, we look forward to continuing to deliver advanced steel solutions and technology transfer to the marketplace.

The SMDI provides a new opportunity for the steel industry, and we are excited to position steel to compete in the challenging marketplace of the future.

DAVID C. JEANES

David C. Jeanes is president of the Steel Market Development Institute.

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